€13 million project issued without a tender

A €13 million public private partnership project has been awarded to construction magnate and PN donor Zaren Vassallo without a call for tenders and the competitors have not been given the right to appeal against the decision of the St Julian's local council decision.

St Julian's mayor Peter Bonello said he could not comment because of the St Julian's feast while PN leader Simon Busuttil is aware of the allegations of impropriety over the award of the tender, but in a short reply to MaltaToday, he said that he is convinced the council followed all the necessary procedures.

CareMalta, a private elderly care provider owned by construction magnate and well-known PN donor and activist Zaren Vassallo, is set to become the PN-dominated St Julian's local council's partner in the construction of a €13 million home for the elderly.

Vassallo's company was one of three which applied for the expression of interest published by the council in July, however following a decision taken on 19 August, CareMalta is the only company in the running for the project.

On 21 July, the St Julian's council published a small, inconspicuous advert in local newspapers in which it issued an expression of interest (EOI) for a community home for the elderly, a car park and new offices for the local council.

The advert explained that the council was looking for a "strategic partner who will work with the council's architect to submit bids and/or enter into negotiations with Government for the realisation of this project".

In total three companies, Attard Brothers, CareMalta and JSGR Consortium submitted an application; however, in what seems like an arbitrary decision by the St Julian's local council, two out of the three applicants were disqualified from the process, leaving CareMalta as the sole bidder.

The two excluded companies were not given any explanation for their disqualification by the local council led by PN Mayor Peter Bonello and were also denied the opportunity to appeal this decision.

In August 2010, the Nationalist mayor said that once the permits were in place a tender would be issued, however the local council has decided to do away with the public tender.

EOIs are normally issued to assess the level of international and local interest in a particular proposal. Subsequently, a public tender is usually issued to select the bid for which the Department of Contracts becomes responsible.

The main difference between the two is that while a public tender includes the possibility of an appeal if any of the bidders feels the process was unfair, an EOI simply leaves it up to the council to choose the most favourable bid and its decision will be final.

Contacted by MaltaToday, Mayor Peter Bonello refused to answer questions regarding the council's decision. Asked to explain why the council did not issue a public tender as promised, Bonello said be would not answer questions over the phone.

The mayor said he would only reply to questions on the €13 million project via email, since he could not verify whether the person on the other end of the line was really a journalist.

Moreover, Bonello said he would be replying to the questions on Tuesday, since St Julian's was celebrating the parish feast over the weekend.

The council had set an 8 August deadline for interested parties to submit documentation outlining their experience in the sector of care for the elderly and the construction industry.

Apparently, the decision to exclude the two companies from the process was taken on 18 August. However the latest council minutes online date back to 27 June.

Sources have said that the excluded applicants voiced their concern at the manner the local council dealt with the EOI with PN leader Simon Busuttil, however their complaints fell on deaf ears.

In a brief reply to MaltaToday's questions, the Nationalist Party's director of information confirmed that the meeting had taken place but assured that the St Julian's local council had followed all legal and procedural requirements.

"A meeting was held this week between Dr Busuttil and representatives from a company following their request. Following the meeting, contact was made between the party and the Nationalist Party's councillors within the St Julian's local council to ensure that all legal and procedural requirements had been strictly adhered to."

The party added that all its councillors confirmed that they had "followed the procedure agreed with government and have now also sought further confirmation of this with the Department of Contracts and the Ministry of Finance. The Nationalist Party has directed its elected representatives to follow the advice given by the concerned authorities and will continue directing its efforts to ensure full transparency and fairness in the fulfilment of its councillors' responsibilities."

In 2010, the St Julian's local council announced its plans to strike a public-private partnership agreement for the development of the €13 million project adjacent to the Regional Road. The council said that it would be providing the land, measuring 5,200 square metres, and the private sector would build and run the home.

The council's plans include a five-storey building, an underground car park with a capacity for over 100 cars and a community home, which would have between 130 and 200 beds with a public garden.

The project's entrance is planned to be from Anglu Mikiel Borg Street, the road leading from Spinola Bay up to Regional Road and to cover an area as large as a football field.

Council architect Stephen Farrugia, married to Mosta's PN mayor, Shirley Farrugia, also made plans for a new council office to be included in the project.

The land, adjacent to the Al Fateh school at Ta' Giorni, is government owned and was passed on to the council to be used for a social purpose.

CareMalta, owned by former mayor of Mosta Nazzareno Vassallo was the recipient of €1.93 million for the services it provided to the government between January and September 2012.

In the period between January and September, the government paid a total of €3.86 million to private companies and the Archdiocese of Malta for services provided to the elderly in private residential homes.

In the midst of this year's general election, former PN secretary-general Paul Borg Olivier confirmed that Vassallo's construction group had loaned €250,000 to Media.Link.

In February, MaltaToday revealed that the construction magnate had transferred €250,000 from his company, Vassallo Builders Group Ltd, in 2012 to the Nationalist Party company Media.Link.

Borg Olivier confirmed that the €250,000 donation was a "loan" Vassallo made to Media.Link to assist its cash flow problems back in July 2012. However former PN leader and PM Lawrence Gonzi has denied "feeling obliged" to Nazzareno Vassallo.

Vassallo's healthcare company today employs former PN secretary-general Joe Saliba, a close friend of his.